RLPC-PAI faces rival bid for troubled Monier Group

LONDON May 12 Private equity firm Paribas
Affaires Industrielles (PAI) is facing a battle for control of
building materials firm Monier Group with a group of distressed
debt investors, sources said on Tuesday.

Lenders to debt-laden Monier Group -- formerly known as
Lafarge Roofing -- rejected an aggressive debt-for-equity swap
proposal from PAI and are now awaiting a formal counter offer
from a group of distressed investors, two sources said.

PAI declined to comment.

Monier Group is one of the world's largest roof tiling and
chimney firms and owns Redland, a UK roof tiling firm.

Apollo Management, TowerBrook Capital and York Capital,
which own around 40 percent of Monier Group's debt, made an
informal alternative offer to lenders last Thursday, an investor
said.

PAI's debt-for-equity offer asked lenders to slash Monier
Group's debt from around 1.7 billion euros to 600 million euros
in return for a cash injection of up to 150 million euros, he
added.

PAI offered lenders around 24 percent of the company and
offered the management a small 3-4 percent stake, which would
have given it 72-73 percent of the company, the investor said.

"Why would you give up two-thirds of the debt for 20 percent
of the company?" he added.

Goldman Sachs is advising PAI and Monier Group.

Monier Group's lenders, which comprise more than 100 banks
and hedge funds, are taking a tougher line and want a bigger
stake in the firm in exchange for such a large drop in their
debt, three sources said.

Reaching a resolution is a pressing concern for Monier
Group, which faces a looming interest payment on June 30 and
possible covenant breach after a steep drop in earnings before
interest, tax, depreciation and amortisation, a source with
knowledge of the deal said.

Indicative bids on the company's term loans A, B and C are
at 32.5-33.5 percent of face value which suggests stress and the
company's second lien loan is bid at 3.6 percent, according to
Thomson Reuters LPC data, which points to negligable recovery
rates

The source with knowledge of the deal said that there is a
"willingness to continue talks" and that the lender syndicate
favoured a sponsor-driven solution rather taking control of the
company.

Monier Group was bought by PAI in December 2006 in a 2.4
billion euro buyout and Lafarge LAFP.PA retained a 35 stake in
the firm.

The acquisition was financed by BNP Paribas and JP Morgan
which arranged a 1.97 billion euro loan in 2007 that comprised
1.67 billion euros of senior debt and 300 million euros of
second lien debt.

(Additional reporting by Simon Meads; Editing by David
Cowell)

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